Anyone considering renting out their property should consider purchasing landlord insurance. It provides financial assistance to property owners if their property should become damaged or destroyed, whether it be a condo, apartment or single family home. If you own rental property, it most likely represents a significant investment, and you wouldn’t want to risk losing it to a fire or trying to rebuild after a disaster, without insurance. As with homeowners insurance, if you carry a mortgage on the property, your lender will probably require it.
How It Works
Once the insurance is purchased, you need to make premium payments to cover the cost of insurance. If you should have to file a claim, you need to cover the deductible amount, and then the insurance carrier will step in to cover the damages based on the limits you’ve agreed to in your policy.
Different Types of Coverage
Liability coverage is an important consideration when you are a landlord. This coverage can help to protect you financially from lawsuits and medical costs, both of which can quickly skyrocket if a visitor is injured on your property. Rental properties often have common areas with laundry rooms, swimming pools, hot tubs or playground areas. Anyone using these facilities could easily be injured and you would be responsible if they should decide to file a lawsuit.
Property damage coverage will cover the costs of rebuilding or repairing your property if lightning, fire or a natural disaster strikes. Vandalism is usually covered, as well.
Loss of income coverage can be important if the property becomes damaged and you suffer a loss of rental income due to it being uninhabitable for a period of time.
Purchasing landlord insurance with liability, property and loss of income coverage provides the financial assistance that most property owners would need if a disaster were to occur. Protecting your investment properly can mean a better night’s sleep for all.